Starbucks testing blockchain to empower coffee farmers

Starbucks is piloting the use of data technology, including blockchain, to make its coffee supply chains more transparent.

The firm hopes the technology will provide real time information about the beans within the supply chain and help financially empower rural farmers.

The two-year pilot scheme will include farmers in Costa Rica, Colombia and Rwanda.

Kevin Johnson, chief executive officer at Starbucks, said: “Over the next two years, we will look to demonstrate how technology and innovative data platforms can give coffee farmers even more financial empowerment.

“We’ll leverage an open-source approach to share what we learn with the rest of the world.”

Starbucks has not outlined exactly what technology it will be piloting, but Arthur Karuletwa, director of traceability at Starbucks, indicated mobile phone technology would be at the core. “I’ve met farmers who have very little by way of possessions, but they have a mobile phone.

“Digital has become the economic engine of this century, and traceability preserves the most valuable assets we have as human beings, our identity,” he said.

Ronald Peters, executive director of the Costa Rican Coffee Institute, which is working with Starbucks, said the firm is also exploring blockchain’s distributed ledger technology. He said: “Many years ago, our controls and transactions were all done by paper, and today we are even talking about blockchain technology.

“This shows us that, more than being at the front of every technological advancement, having the information and being flexible and adaptable are important.”

Separately, Coca-Cola confirmed this week it was piloting the use of blockchain technology to prevent forced labour in its sugarcane supply chain. The project, in partnership with the US State Department and several other firms including tech firm Blockchain Trust Accelerator, will create a registry of workers and their contracts.

Scott Busby, deputy assistant secretary at the State Department told Reuters: “The Department of State is excited to work on this innovative blockchain-based pilot.”